May 8, 2006	Monday	Rabi-us-Sani 9, 1427

Physical activity on the Karachi wholesale commodity markets during last week stayed on the higher side as prices of some essential items were marked lower on active selling after steady arrivals.

Dealers said that the ready position remained fairly comfortable, notably on the pulses sector as importers continued to sell at the prevailing prices apparently in an effort to lower their unsold stocks.

In the process, prices of some types suffered a sharp decline under the lead of urad which fell from its all-time peak level of Rs5,300 per bag to Rs4,500, showing a fall of Rs500 per bag, they said.

Prices of all varieties however, were still on the higher side and could only fall once supply position improves provided the upcountry traders and importers maintain normal supplies to wholesale market, they added.

Prices of other essential items including wheat and rice remained fairly stable owing to steady arrivals from the upcountry markets, notably of new crop wheat despite strong mill-and-broker-buying.

Reports reaching here from the wheat belt indicate some procurement problems owing to pressure on the supplies of bag. As a result, a good number of growers are reportedly selling to middlemen at much lower rates than the officially fixed support price.

As farmers’ holding capacity is limited, therefore if they fail to get a good price of their produce from local food departments they prefer to sell the same at lower rates to traders in wheat business.

On import front, a number of ships loaded with sugar are regularly calling at the port and during the last couple of weeks about half a dozen ships with approximately 0.1 million tons of the commodity, both on the TCP and private sector account have arrived at the Karachi port.

The prices quoted by private sector retailers vary from city to city but consumers generally complain of higher prices while the TCP selling outlets could not meet the entire demand owing to its limitations.

Industrial raw materials, on the other hand, did not show downward trend and remained on the higher side, while some varieties of cereals came in for active selling followed by the reports of larger arrivals from the Sindh markets.

Much of the physical activity remained confined to pulses sector amid conflicting reports of supply followed by reports of lower imports.

However, after mid-week prices of some varieties eased from the early high levels under the lead of moong which fell by Rs125 per bag. On the other hand urad imported type came in for active selling and suffered a sharp decline of Rs500 per 100kg bag.

Imported varieties of masoor dal being exceptions were quoted higher by Rs300 and so did gram whole and gram dal which rose by Rs125 to 200. All other varieties were quoted at previous levels.

Wheat on the other hand was firmly held at previous levels, partly owing to 10 per cent duty on imports by the private sector, and to steady new crop arrivals from upcountry markets.

Sugar prices fluctuated from area to area but remained steady at over Rs30 per kilo despite official efforts to ease prices after the opening of mobile selling outlets for general consumers.

Import of the commodity continues on priority basis as ships loaded with sugar are calling at the Karachi port each week. About 6,000 tons of sugar is unloaded daily from these.

Rice sector again stayed dormant as prices of both IRRI and basmati, including fine varieties were traded at previous levels despite fairly large physical shipments of the commodity against forward deals with foreign buyers.

Industrial raw materials on the other hand remained expensive as stockholders maintained a near-squeeze on supplies. Arrivals from the upcountry were on the lower side which in turn kept the prices high.

Among cereals, maize was firmly held at last levels - thanks to steady new crop arrival and an improvement in ready offtake. But on the other hand bajra rose by Rs15 for inferior type, while its fine variety was marked down by Rs20.

Major oilseeds, including cottonseed, rapeseed, castorseed and til were firmly held at previous levels as supplies matched the local demand amid moderately active trading.

Oilcakes on the other hand posted sharp gain of Rs15 on reports of firm oil market, while rapeseed cakes were traded around previous levels amid slow ready offtake.—M.A.